SUPPLY CHAIN REDESIGN FOR NEW PRODUCT DEVELOPMENT WITH DUAL-PRODUCT ROLLOVER STRATEGY (CASE STUDY HEADPHONE INDUSTRY)

Introducing new products for companies in a competitive business environment is imperative. Designing an appropriate supply chain for the successful development of new products leads to growth and success in the competition. Supply chain design or configuration is essential to the success of a business since it can increase the profit of the whole supply chain. Supply chain management aims to determine the link between network components and specify the inventory level in each part of the supply network, production quantity, manner of transportation, and other related problems. Also, during the new product development process, companies encounter decisions such as producing independent products, immediate replacement of a new product with an old one (single-product rollover strategy), or gradual replacement over several periods (dual-product rollover strategy). A dual-product rollover strategy can be more efficient and less costly in some cases, although it has received less attention. In the present study, the four-level supply chain (including suppliers, manufacturers, distributors, and customers groups) model for old and new products is presented by considering a dual-product rollover strategy. Objective function consists of net profit for manufacturers and distributors, cost of customer dissatisfaction, cost of unemployment resources, and cost of designing new products. Also, constraints control the equality between production and inventory with the flow of products, production capacity, product rollover strategy, shipping the goods after that connection determined, and level of initial inventory. The model is solved by GAMS software using actual data from a company that is active in the digital appliance industry and produces wired and wireless headphones as non-independent products (it is implied that with launching the wireless headphone, demand for wired headphones is reduced). After presenting the results, sensitivity analysis is performed on the parameters to determine the most effective ones on the objective function. Then, the results of solving this model under a dual-product rollover strategy are compared with those of the single-product rollover strategy (the model can be converted into a single-product rollover strategy by modifying rollover parameter), and managerial insights are presented.